Biotechnology stocks rose strongly on Wednesday, leading many to question if a new rally may be on the way. The iShares NASDAQ Biotechnology Index (ETF) (NASDAQ:IBB) moved up by over 2% and was at last check above $276 per share.
While the index is still in a downward trend, the slope of the decline has decreased dramatically giving bulls some optimism of a turnaround on the horizon.
With IBB up more than 2% on the day and above a key resistance level, technically the ETF looks like a near term rally may be in the works.
The biotech sector, like all other risk assets, is of course benefiting from the excess global liquidity. As long as developed world central banks continue with their ultra-loose monetary policy measures, biotechnology stocks will find support despite weak fundamentals.
One of the major movers in the biotech sector today is Organovo Holdings Inc. (NYSE MKT:ONVO). Based in San Diego, California, Organovo Holdings is an early commercial-stage company engaged in the development and commercialization of functional human tissues.
The company focuses on the generation of three-dimensional (3D) human tissues, by utilizing its platform technology to create human tissue constructs in 3D.
Apart from the rally in the broader sector, ONVO shares are also benefiting from an announcement made by the company earlier today. ONVO announced that it is on track to commercialize its second tissue, the kidney proximal tubule, in the third calendar quarter of 2016.
As part of its pre-commercialization activities, Organovo introduced an early access program for preferred partners and has signed the first customer orders to study the effects of drug exposure on the kidney proximal tubule. The company also said that it has actively engaged with additional biopharmaceutical companies, indicating strong interest in this program and its kidney tissue.
Paul Gallant, General Manager of Commercial Operations, said that the power and versatility of the company’s technology platform allows it to create multiple tissues that address a number of different customer needs.
At last check, ONVO shares were trading 8.55% higher at $4.19 on volume pf 1.64 million, which is well above the daily average volume of 1.13 million.
